RBI is once again in dilemma over the rate hike . It is on the one hand worried about rising food inflation and on the other hand its also worried slowness of growth.
Well, in my opinion it would be a difficult task to tame the rising food inflation. Despite the good monsoon what we are facing globally is fickle and erratic rain fall. In our county we had floods in UK, Punjab which affected paddy crop . We had drought in Bihar and had scanty rainfall in some parts of the country. The area under agriculture is getting reduced day by day and after the Green Revolution there has been no serious efforts to increase the productivity.
Irony of this rising inflation is that the farmers are still not getting the benefit of higher food price . We will talk about it in detail in some other time.
Today market may remain flat and volatile ahead of the key events.
Keep HDFC and BPCL on your radar.
Tuesday, November 2, 2010
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